LatAm Startup Funding Sees A Modest Uptick

Funding to Latin American startups appears to have stabilized in recent quarters. However, investment remains far, far below the record highs reached a few years ago.

That was the broad finding from a Crunchbase overview of funding to South America and Central American companies in the third quarter. Funding was flat to up across stages, with a few big rounds in the mix.

In total, we tallied $884 million in known seed through growth-stage investments to the region. That’s a gain of about 14% from the prior quarter and year-ago levels. However, it’s still less than a quarter of what companies secured during the peak quarter in early 2022.

For perspective, we charted out total investment, color-coded by stage, for the past 14 quarters.

Round counts fell some at seed and early stage, but increased for late-stage dealmaking. (Over time, we expect seed counts to rise as deals are entered later into the Crunchbase database.)

For a bigger-picture view, we charted deal counts for the past 14 quarters below.

Table of contents

Fintech is still huge, but a bit less dominant

As usual, fintech and fintech-adjacent startups brought in many of the largest rounds. However, we also saw good-sized investments in other sectors, including B2B commerce and digital health. To illustrate, we put together a list of 11 of the quarter’s largest deals.

The largest financing went to Mexico City-based Stori, a provider of credit cards and online financial services that raised $212 million in an August financing that was roughly half debt and half equity. With the latest round, the 5-year-old unicorn plans to expand into Colombia.

Another Mexican company, OCN, or One Car Now, secured $86 million in a July debt and equity round to expand its business of offering flexible car rentals, targeted to gig workers.

From São Paulo, Brazil, meanwhile, Cayena, an online procurement platform for restaurants and other food purveyors, secured a $55 million September Series B.

On the fintech front, Colombian payments platform Cobre landed $35 million in Series B financing. And one of Brazil’s best-known unicorns, online banking platform Neon, picked up a $26 million investment led by Microsoft‘s venture fund, M12.

Moving in a positive direction

Overall, startup investment didn’t show a major gain in Q3. But it was a bit better than Q2, which was itself a bit better than Q1. So, things at least are moving in a positive direction.

Looking ahead, it seems likely that momentum will continue, given the strong pipeline of growth companies and reserves of capital by investors who sat things out in 2023 and early this year.

Methodology

The data contained in this report comes directly from Crunchbase, and is based on reported data. Data reported is as of Oct. 2, 2024.

Note that data lags are most pronounced at the earliest stages of venture activity, with seed funding amounts increasing significantly after the end of a quarter/year.

Please note that all funding values are given in U.S. dollars unless otherwise noted. Crunchbase converts foreign currencies to U.S. dollars at the prevailing spot rate from the date funding rounds, acquisitions, IPOs and other financial events are reported. Even if those events were added to Crunchbase long after the event was announced, foreign currency transactions are converted at the historic spot price.

Glossary of funding terms

We have made a change to how we include corporate funding rounds in our reporting as of January 2023. Corporate rounds are only included if a company has raised an equity funding at seed through a venture series funding round.

Seed and angel consists of seed, pre-seed and angel rounds. Crunchbase also includes venture rounds of unknown series, equity crowdfunding and convertible notes at $3 million (USD or as-converted USD equivalent) or less.

Early stage consists of Series A and Series B rounds, as well as other round types. Crunchbase includes venture rounds of unknown series, corporate venture and other rounds above $3 million, and those less than or equal to $15 million.

Late stage consists of Series C, Series D, Series E and later-lettered venture rounds following the “Series [Letter]” naming convention. Also included are venture rounds of unknown series, corporate venture and other rounds above $15 million.

Technology growth is a private-equity round raised by a company that has previously raised a “venture” round. (So basically, any round from the previously defined stages.)

Illustration: Dom Guzman